Technical Analysis: Gold bounces off two-week-old support but bears keep the reins

Technical Analysis: Gold bounces off two-week-old support but bears keep the reins

Despite recent bounces off the short-term support line, gold keeps the previous day’s breakdown of ascending triangle formation, suggesting the metal’s further weakness until it trades below the triangle’s support, at $1,849 now. As a result, fresh selling can be witnessed on a downside break of the immediate horizontal line around $1,829, which in turn sets the tone for the quote’s drop towards the $1,800 threshold. However, the January low of $1,802 and $1,817 can offer intermediate halts during the south-run.

It should be noted that an upside clearance of the previous support line, currently around $1,849 will have 200-SMA and the stated triangle’s upper line, respectively near $1,871 and $1,875 as extra filters to the north. In a case where gold buyers manage to cross $1,875, the $1,900 round-figure and $1,928 may entertain the optimists before highlighting January’s top close to $1,960.

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